Company registration number 01376835 (England and Wales)
NORTON CAST PRODUCTS LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JANUARY 2023
NORTON CAST PRODUCTS LIMITED
COMPANY INFORMATION
Directors
P Ingall
M Newell
D Senior
B Robinson
P Hague
J Weston
A Shaw
Secretary
P Ingall
Company number
01376835
Registered office
Capital Steel Works
Tinsley Park Road
Sheffield
S9 5DL
Auditor
BHP LLP
2 Rutland Park
Sheffield
S10 2PD
Bankers
Yorkshire Bank plc
661 Staniforth Road
Darnall
Sheffield
S9 4RE
NORTON CAST PRODUCTS LIMITED
CONTENTS
Page
Strategic report
1
Directors' report
2
Directors' responsibilities statement
3
Independent auditor's report
4 - 6
Statement of comprehensive income
7
Balance sheet
8
Statement of changes in equity
9
Notes to the financial statements
10 - 19
NORTON CAST PRODUCTS LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 JANUARY 2023
- 1 -
The directors present the strategic report for the year ended 31 January 2023.
Fair review of the business
The business has remained profitable in another difficult year.
With regard to the financial performance of the business during the year the key performance indicators are as follows:
The cash position is again very healthy with a year-end bank balance of £2,242,852.
The business remains in a strong financial position.
Principal risks and uncertainties
The principal risks and uncertainties that the business is facing are as follows:
The war in Ukraine and the resulting stresses and strains in the market place for both energy and raw materials (in particular the cost of metals).
Current general inflationary pressures resulting in higher labour rates and material costs.
Shortage of available people in the labour market.
General uncertainty within the market for steel castings.
The continued effect that Brexit may cause on sales into Europe.
The vagaries of the oil and gas markets into which we supply.
High energy costs.
Once again thank you to all our employees for all their hard work and efforts during another difficult year.
P Ingall
Director
19 July 2023
NORTON CAST PRODUCTS LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 JANUARY 2023
- 2 -
The directors present their annual report and financial statements for the year ended 31 January 2023.
Principal activities
The principal activity of the company continued to be that of manufacture of steel and alloy foundry castings.
Results and dividends
The results for the year are set out on page 7.
Ordinary dividends were paid amounting to £250,000. The directors do not recommend payment of a further dividend.
Directors
The directors who held office during the year and up to the date of signature of the financial statements were as follows:
P Ingall
M Newell
D Senior
B Robinson
P Hague
J Weston
A Shaw
Auditor
The auditor, BHP LLP, is deemed to be reappointed under section 487(2) of the Companies Act 2006.
Statement of disclosure to auditor
So far as each person who was a director at the date of approving this report is aware, there is no relevant audit information of which the company’s auditor is unaware. Additionally, the directors individually have taken all the necessary steps that they ought to have taken as directors in order to make themselves aware of all relevant audit information and to establish that the company’s auditor is aware of that information.
On behalf of the board
P Ingall
Director
19 July 2023
NORTON CAST PRODUCTS LIMITED
DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 31 JANUARY 2023
- 3 -
The directors are responsible for preparing the annual report and the financial statements in accordance with applicable law and regulations.
Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the company and of the profit or loss of the company for that period. In preparing these financial statements, the directors are required to:
select suitable accounting policies and then apply them consistently;
make judgements and accounting estimates that are reasonable and prudent;
prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business.
The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the company’s transactions and disclose with reasonable accuracy at any time the financial position of the company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
NORTON CAST PRODUCTS LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF NORTON CAST PRODUCTS LIMITED
- 4 -
Opinion
We have audited the financial statements of Norton Cast Products Limited (the 'company') for the year ended 31 January 2023 which comprise the statement of comprehensive income, the balance sheet, the statement of changes in equity and notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).
In our opinion the financial statements:
give a true and fair view of the state of the company's affairs as at 31 January 2023 and of its profit for the year then ended;
have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
have been prepared in accordance with the requirements of the Companies Act 2006.
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor's responsibilities for the audit of the financial statements section of our report. We are independent of the company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Conclusions relating to going concern
In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.
Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.
Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.
The other information comprises the information included in the annual report other than the financial statements and our auditor's report thereon. The directors are responsible for the other information contained within the annual report. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.
We have nothing to report in this regard.
Opinions on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of our audit:
the information given in the strategic report and the directors' report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
the strategic report and the directors' report have been prepared in accordance with applicable legal requirements.
NORTON CAST PRODUCTS LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF NORTON CAST PRODUCTS LIMITED
- 5 -
Matters on which we are required to report by exception
In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identified material misstatements in the strategic report or the directors' report.
We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion:
adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or
the financial statements are not in agreement with the accounting records and returns; or
certain disclosures of remuneration specified by law are not made; or
we have not received all the information and explanations we require for our audit.
Responsibilities of directors
As explained more fully in the directors' responsibilities statement, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, the directors are responsible for assessing the company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the company or to cease operations, or have no realistic alternative but to do so.
Auditor's responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.
The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below.
The extent to which the audit was considered capable of detecting irregularities, including fraud
Our approach to identifying and assessing the risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, was as follows:
the engagement partner ensured that the engagement team collectively had the appropriate competence, capabilities and skills to identify or recognise non-compliance with applicable laws and regulations;
we identified the laws and regulations applicable to the company through discussions with directors and other management, and from our commercial knowledge and experience of the metal castings sector;
we focused on specific laws and regulations which we considered may have a direct material effect on the financial statements or the operations of the company, including the Companies Act 2006, taxation legislation, employment, environmental and health and safety legislation;
we assessed the extent of compliance with the laws and regulations identified above through making enquiries of management and inspecting legal correspondence; and
identified laws and regulations were communicated within the audit team regularly and the team remained alert to instances of non-compliance throughout the audit.
We assessed the susceptibility of the company’s financial statements to material misstatement, including obtaining an understanding of how fraud might occur, by:
making enquiries of management as to where they considered there was susceptibility to fraud, their knowledge of actual, suspected and alleged fraud;
considering the internal controls in place to mitigate risks of fraud and non-compliance with laws and regulations.
NORTON CAST PRODUCTS LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF NORTON CAST PRODUCTS LIMITED
- 6 -
To address the risk of fraud through management bias and override of controls, we:
performed analytical procedures to identify any unusual or unexpected relationships;
tested journal entries to identify unusual transactions;
assessed whether judgements and assumptions made in determining accounting estimates within the accounts were indicative of potential bias;
investigated the rationale behind significant or unusual transactions.
In response to the risk of irregularities and non-compliance with laws and regulations, we designed procedures which included, but were not limited to:
agreeing financial statement disclosures to underlying supporting documentation;
reading the minutes of meetings of those charged with governance;
enquiring of management as to actual and potential litigation and claims;
reviewing correspondence with HMRC.
There are inherent limitations in our audit procedures described above. The more removed that laws and regulations are from financial transactions, the less likely it is that we would become aware of non-compliance. Auditing standards also limit the audit procedures required to identify non-compliance with laws and regulations to enquiry of the directors and other management and the inspection of regulatory and legal correspondence, if any.
Material misstatements that arise due to fraud can be harder to detect than those that arise from error as they may involve deliberate concealment or collusion.
A further description of our responsibilities is available on the Financial Reporting Council’s website at: https://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.
This report is made solely to the company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company's members those matters we are required to state to them in an auditor's report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company's members as a body, for our audit work, for this report, or for the opinions we have formed.
Paul Winwood
Senior Statutory Auditor
For and on behalf of BHP LLP
19 July 2023
Chartered Accountants
Statutory Auditor
2 Rutland Park
Sheffield
S10 2PD
NORTON CAST PRODUCTS LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 JANUARY 2023
- 7 -
2023
2022
Notes
£
£
Turnover
3
12,363,232
9,299,504
Cost of sales
(9,681,220)
(7,233,995)
Gross profit
2,682,012
2,065,509
Administrative expenses
(2,258,940)
(2,051,460)
Other operating income
62,336
Profit before taxation
423,072
76,385
Tax on profit
7
41,095
54,949
Profit for the financial year
464,167
131,334
The profit and loss account has been prepared on the basis that all operations are continuing operations.
NORTON CAST PRODUCTS LIMITED
BALANCE SHEET
AS AT
31 JANUARY 2023
31 January 2023
- 8 -
2023
2022
Notes
£
£
£
£
Fixed assets
Tangible assets
9
936,986
762,431
Current assets
Stocks
10
1,413,228
960,831
Debtors
11
2,276,803
1,789,560
Cash at bank and in hand
2,260,341
2,242,852
5,950,372
4,993,243
Creditors: amounts falling due within one year
12
(3,778,713)
(2,773,085)
Net current assets
2,171,659
2,220,158
Total assets less current liabilities
3,108,645
2,982,589
Creditors: amounts falling due after more than one year
13
(250,000)
(361,111)
Provisions for liabilities
Deferred tax liability
15
186,400
163,400
(186,400)
(163,400)
Net assets
2,672,245
2,458,078
Capital and reserves
Called up share capital
17
2,000
2,000
Profit and loss reserves
2,670,245
2,456,078
Total equity
2,672,245
2,458,078
The financial statements were approved by the board of directors and authorised for issue on 19 July 2023 and are signed on its behalf by:
P Ingall
Director
Company Registration No. 01376835
NORTON CAST PRODUCTS LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 JANUARY 2023
- 9 -
Share capital
Profit and loss reserves
Total
Notes
£
£
£
Balance at 1 February 2021
2,000
2,624,744
2,626,744
Year ended 31 January 2022:
Profit and total comprehensive income for the year
-
131,334
131,334
Dividends
8
-
(300,000)
(300,000)
Balance at 31 January 2022
2,000
2,456,078
2,458,078
Year ended 31 January 2023:
Profit and total comprehensive income for the year
-
464,167
464,167
Dividends
8
-
(250,000)
(250,000)
Balance at 31 January 2023
2,000
2,670,245
2,672,245
NORTON CAST PRODUCTS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JANUARY 2023
- 10 -
1
Accounting policies
Company information
Norton Cast Products Limited is a private company limited by shares incorporated in England and Wales. The registered office is Capital Steel Works, Tinsley Park Road, Sheffield, S9 5DL.
1.1
Accounting convention
These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006.
The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £.
The financial statements have been prepared on the historical cost convention.The principal accounting policies adopted are set out below.
This company is a qualifying entity for the purposes of FRS 102, being a member of a group where the parent of that group prepares publicly available consolidated financial statements, including this company, which are intended to give a true and fair view of the assets, liabilities, financial position and profit or loss of the group. The company has therefore taken advantage of exemptions from the following disclosure requirements:
Section 7 ‘Statement of Cash Flows’ – Presentation of a statement of cash flow and related notes and disclosures;
Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instrument Issues’ – Carrying amounts, interest income/expense and net gains/losses for each category of financial instrument; basis of determining fair values; details of collateral, loan defaults or breaches, details of hedges, hedging fair value changes recognised in profit or loss and in other comprehensive income;
The financial statements of the company are consolidated in the financial statements of J B Ingall Limited. These consolidated financial statements are available from its registered office.
1.2
Going concern
The directors have reviewed the performance of the company and considered the impact of truemacro economic and geopolitical factors on the company's trade, workforce and supply chain. The directors have reviewed the performance in the year and the trading outlook of the company and concluded that, at the time of approving the financial statements, they have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. The directors therefore continue to adopt the going concern basis of preparation for these financial statements.
1.3
Turnover
Turnover is recognised at the fair value of the consideration received or receivable for goods and services provided in the normal course of business, and is shown net of VAT and other sales related taxes. The fair value of consideration takes into account trade discounts, settlement discounts and volume rebates.
Revenue from the sale of goods is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer (usually on dispatch of the goods), the amount of revenue can be measured reliably, it is probable that the economic benefits associated with the transaction will flow to the entity and the costs incurred or to be incurred in respect of the transaction can be measured reliably.
1.4
Tangible fixed assets
Tangible fixed assets are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.
NORTON CAST PRODUCTS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2023
1
Accounting policies
(Continued)
- 11 -
Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:
Plant and machinery
5% to 50% straight line
Motor vehicles
20% to 33.33% straight line
The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is credited or charged to profit or loss.
1.5
Impairment of fixed assets
At each reporting end date, the company reviews the carrying amounts of its tangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any).
1.6
Stocks
Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost comprises direct materials and, where applicable, direct labour costs and those overheads that have been incurred in bringing the stocks to their present location and condition.
Work in progress is assigned a value based on stage of completion. There are thee key stages in the production process with work in progress banded accordingly. The year-end work in progress valuation is determined by multiplying the sales value by the relevant work in progress banding.
At each reporting date, an assessment is made for impairment. Any excess of the carrying amount of stocks over its estimated selling price less costs to complete and sell is recognised as an impairment loss in profit or loss. Reversals of impairment losses are also recognised in profit or loss.
1.7
Cash and cash equivalents
Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.
1.8
Financial instruments
The company has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.
Financial instruments are recognised in the company's statement of financial position when the company becomes party to the contractual provisions of the instrument.
Basic financial assets
Basic financial assets, which include trade and other receivables and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method.
Other financial assets
Other financial assets, including investments in equity instruments which are not subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the transaction price. Such assets are subsequently carried at fair value and the changes in fair value are recognised in profit or loss, except that investments in equity instruments that are not publicly traded and whose fair values cannot be measured reliably are measured at cost less impairment.
NORTON CAST PRODUCTS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2023
1
Accounting policies
(Continued)
- 12 -
Impairment of financial assets
Financial assets are assessed for indicators of impairment at each reporting end date.
Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows have been affected. The impairment loss is recognised in profit or loss.
Derecognition of financial assets
Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the company transfers the financial asset and substantially all the risks and rewards of ownership to another entity, or if some significant risks and rewards of ownership are retained but control of the asset has transferred to another party that is able to sell the asset in its entirety to an unrelated third party.
Classification of financial liabilities
Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities.
Basic financial liabilities
Basic financial liabilities, including creditors, bank loans, loans from fellow group companies and preference shares that are classified as debt, are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.
Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.
Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Amounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.
Other financial liabilities
Derivatives, including interest rate swaps and forward foreign exchange contracts, are not basic financial instruments. Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently re-measured at their fair value. Changes in the fair value of derivatives are recognised in profit or loss in finance costs or finance income as appropriate, unless hedge accounting is applied and the hedge is a cash flow hedge.
Debt instruments that do not meet the conditions in FRS 102 paragraph 11.9 are subsequently measured at fair value through profit or loss. Debt instruments may be designated as being measured at fair value through profit or loss to eliminate or reduce an accounting mismatch or if the instruments are measured and their performance evaluated on a fair value basis in accordance with a documented risk management or investment strategy.
Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities.
Derecognition of financial liabilities
Financial liabilities are derecognised when the company’s contractual obligations expire or are discharged or cancelled.
NORTON CAST PRODUCTS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2023
1
Accounting policies
(Continued)
- 13 -
1.9
Equity instruments
Equity instruments issued by the company are recorded at the proceeds received, net of transaction costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the company.
1.10
Derivatives
Derivatives are initially recognised at fair value at the date a derivative contract is entered into and are subsequently remeasured to fair value at each reporting end date. The resulting gain or loss is recognised in profit or loss immediately unless the derivative is designated and effective as a hedging instrument, in which event the timing of the recognition in profit or loss depends on the nature of the hedge relationship.
A derivative with a positive fair value is recognised as a financial asset, whereas a derivative with a negative fair value is recognised as a financial liability.
1.11
Taxation
The tax expense represents the sum of the tax currently payable and deferred tax.
Current tax
The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the profit and loss account because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The company’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.
Deferred tax
Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.
1.12
Employee benefits
The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock or fixed assets.
The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.
Termination benefits are recognised immediately as an expense when the company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.
1.13
Retirement benefits
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
1.14
Government grants
Government grants are recognised at the fair value of the asset received or receivable when there is reasonable assurance that the grant conditions will be met and the grants will be received.
Government grants relating to turnover are recognised as income over the periods when the related costs are incurred. Grants relating to an asset are recognised in income systematically over the asset's expected useful life. If the grant conditions have been met and /or certified by the grant issuing body, the remainder of the deferred grant is released to profit and loss.
NORTON CAST PRODUCTS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2023
1
Accounting policies
(Continued)
- 14 -
1.15
Foreign exchange
Transactions in currencies other than pounds sterling are recorded at the rates of exchange prevailing at the dates of the transactions. At each reporting end date, monetary assets and liabilities that are denominated in foreign currencies are retranslated at the rates prevailing on the reporting end date. Gains and losses arising on translation in the period are included in profit or loss.
2
Judgements and key sources of estimation uncertainty
The preparation of financial information required management to make judgements, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets and liabilities, income and expenses. Judgements and estimates are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. The resulting accounting estimates may differ from the related actual results.
There are no key judgements, estimates or assumptions that have been made by the directors in the preparation of these financial statements.
3
Turnover and other revenue
An analysis of the company's turnover is as follows:
2023
2022
£
£
Turnover analysed by class of business
Production and sale of steel and alloy castings
12,363,232
9,299,504
2023
2022
£
£
Turnover analysed by geographical market
United Kingdom
8,978,922
7,166,814
Europe
2,513,992
1,980,065
Rest of World
870,318
152,625
12,363,232
9,299,504
2023
2022
£
£
Other revenue
Grants received
-
62,336
NORTON CAST PRODUCTS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2023
- 15 -
4
Operating profit
2023
2022
Operating profit for the year is stated after charging/(crediting):
£
£
Exchange gains
(4,907)
(3,907)
Government grants
-
(62,336)
Fees payable to the company's auditor for the audit of the company's financial statements
15,170
13,550
Depreciation of owned tangible fixed assets
110,166
98,782
5
Employees
The average monthly number of persons (including directors) employed by the company during the year was:
2023
2022
Number
Number
Production
53
49
Administration
16
22
Directors
6
6
Total
75
77
Their aggregate remuneration comprised:
2023
2022
£
£
Wages and salaries
2,317,336
2,151,419
Social security costs
246,232
219,830
Pension costs
62,452
57,238
2,626,020
2,428,487
6
Directors' remuneration
2023
2022
£
£
Remuneration for qualifying services
503,708
498,815
Company pension contributions to defined contribution schemes
14,319
10,884
518,027
509,699
The number of directors for whom retirement benefits are accruing under defined contribution schemes amounted to 6 (2022 - 6).
NORTON CAST PRODUCTS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2023
6
Directors' remuneration
(Continued)
- 16 -
Remuneration disclosed above include the following amounts paid to the highest paid director:
2023
2022
£
£
Remuneration for qualifying services
90,000
93,091
Company pension contributions to defined contribution schemes
2,700
2,643
7
Taxation
2023
2022
£
£
Current tax
UK corporation tax on profits for the current period
(64,095)
(126,349)
Deferred tax
Origination and reversal of timing differences
23,000
71,400
Total tax credit
(41,095)
(54,949)
The actual credit for the year can be reconciled to the expected charge for the year based on the profit or loss and the standard rate of tax as follows:
2023
2022
£
£
Profit before taxation
423,072
76,385
Expected tax charge based on the standard rate of corporation tax in the UK of 19.00% (2022: 19.00%)
80,384
14,513
Tax effect of expenses that are not deductible in determining taxable profit
156
98
Change in unrecognised deferred tax assets
5
56
Group relief
2,841
1,408
Permanent capital allowances in excess of depreciation
(9,159)
(6,981)
Research and development tax credit
(120,840)
(103,257)
Effect of change in deferred tax rates
5,518
39,214
Taxation credit for the year
(41,095)
(54,949)
8
Dividends
2023
2022
£
£
Final paid
250,000
300,000
NORTON CAST PRODUCTS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2023
- 17 -
9
Tangible fixed assets
Plant and machinery
Motor vehicles
Total
£
£
£
Cost
At 1 February 2022
4,419,192
8,900
4,428,092
Additions
284,721
284,721
At 31 January 2023
4,703,913
8,900
4,712,813
Depreciation and impairment
At 1 February 2022
3,659,430
6,231
3,665,661
Depreciation charged in the year
108,387
1,779
110,166
At 31 January 2023
3,767,817
8,010
3,775,827
Carrying amount
At 31 January 2023
936,096
890
936,986
At 31 January 2022
759,762
2,669
762,431
10
Stocks
2023
2022
£
£
Raw materials and consumables
483,372
359,941
Work in progress
929,856
600,890
1,413,228
960,831
11
Debtors
2023
2022
Amounts falling due within one year:
£
£
Trade debtors
2,122,309
1,596,290
Corporation tax recoverable
64,095
126,349
Other debtors
22,831
Prepayments and accrued income
67,568
66,921
2,276,803
1,789,560
NORTON CAST PRODUCTS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2023
- 18 -
12
Creditors: amounts falling due within one year
2023
2022
Notes
£
£
Bank loans
14
111,111
134,346
Trade creditors
2,699,193
2,161,376
Amounts owed to group undertakings
425,814
111,798
Taxation and social security
60,438
134,923
Other creditors
185,816
59,749
Accruals and deferred income
296,341
170,893
3,778,713
2,773,085
13
Creditors: amounts falling due after more than one year
2023
2022
Notes
£
£
Bank loans and overdrafts
14
250,000
361,111
14
Loans and overdrafts
2023
2022
£
£
Bank loans
361,111
495,457
Payable within one year
111,111
134,346
Payable after one year
250,000
361,111
The long-term loans are secured by fixed and floating charges over the assets of Norton Cast Products Limited.
The bank loan is a Coronavirus Business Interruption loan which is repayable in monthly instalments by 16 April 2026 and carries an interest rate of 3% over the Bank of England's Base Rate.
15
Deferred taxation
Deferred tax assets and liabilities are offset where the company has a legally enforceable right to do so. The following is the analysis of the deferred tax balances (after offset) for financial reporting purposes:
Liabilities
Liabilities
2023
2022
Balances:
£
£
ACAs
187,500
164,500
Short term timing differences
(1,100)
(1,100)
186,400
163,400
NORTON CAST PRODUCTS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2023
15
Deferred taxation
(Continued)
- 19 -
2023
Movements in the year:
£
Liability at 1 February 2022
163,400
Charge to profit or loss
23,000
Liability at 31 January 2023
186,400
16
Retirement benefit schemes
2023
2022
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
62,452
57,238
The company operates a defined contribution pension scheme for all qualifying employees. The assets of the scheme are held separately from those of the company in an independently administered fund.
17
Share capital
2023
2022
2023
2022
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary shares of £1 each
2,000
2,000
2,000
2,000
18
Operating lease commitments
At the reporting end date the company had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:
2023
2022
£
£
Within one year
23,614
71,399
Between two and five years
13,361
12,605
36,975
84,004
19
Related party transactions
In accordance with FRS 102 33.1.A, transactions between Norton Cast Products Limited and its parent J B Ingall Limited have not been disclosed.
20
Ultimate controlling party
The ultimate parent company is J B Ingall Limited, a company registered in England and Wales. J B Ingall Limited prepares group financial statements and copies can be obtained from Companies House.
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